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28 Jun 2012

ExxonMobil is a blight on humanity

On Wednesday Exxon Chief Executive Rex Tillerson broke from the previous company line that it wasn’t being hurt by natural gas prices, admitting that the Irving, Texas-based firm is among those hurting from the price slump.

“We are all losing our shirts today.” Mr. Tillerson said in a talk before the Council on Foreign Relations in New York City. “We’re making no money. It’s all in the red.”

His comments mark a departure from remarks made earlier this year on how lower natural gas prices hadn’t yet hurt the company because of its operational efficiency and low production costs.

Rex Tillerson is obviously off the planet. ExxonMobil posted first-quarter earnings this year of $9.45 billion with cash reserves of $19.1 billion, so they're hardly not making money. In fact ExxonMobil has led Fortune 500’s annual ranking of the nations’ most profitable firms in the last nine out of ten years.

Much of this profit is because (like most oil and gas companies) ExxonMobil avoids paying taxes and receives large subsidies from the government. They paid an average 17.6 percent in federal tax, which is nearly half the 35 percent normal tax rate in the US and less than the average federal tax rate of 20.4%, and that's if they pay tax at all.

The company paid no taxes at all to the U.S. federal government in 2009 on its domestic profits of nearly $2.6 billion. It appears that they avoided the tax man that year by legally funneling their profits through wholly owned subsidiaries in countries like the Cayman Islands, and reinvesting their earnings overseas.

Nothing like a bit of tax avoidance to go along with profiteering from the earths destruction.